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Sunac China has received overwhelming creditor approval for its offshore debt restructuring proposal, marking a significant move towards financial stabilisation amid China's prolonged property crisis. The plan, endorsed by 98.5% of voting creditors representing 94.5% of total claims, covers about USD 7.96 billion in offshore debt. The developer is now seeking final court approval in Hong Kong, as other major Chinese developers, including Country Garden and China Vanke, also navigate complex restructuring and debt relief processes.
Sunac China stated earlier this week that its offshore debt restructuring plan had been endorsed by a majority of creditors during a court-convened meeting held in Hong Kong. The property developer confirmed that 98.5% of voting creditors, representing approximately 94.5% of the total voting claims, supported the restructuring plan. The proposal covers about USD 7.96 billion in offshore debt and represents a major step in the company's broader strategy to restore stability following a prolonged property downturn in China that has significantly strained developer liquidity. Advertisement
The developer announced that it would now seek final approval from the Hong Kong court at a sanction hearing expected to take place in the coming weeks. The approval is seen as a crucial milestone in Sunac's efforts to reduce financial pressure after posting a loss of 12.81 billion yuan in the first half of 2025, an improvement from a 14.96 billion yuan loss recorded a year earlier.
China's property sector continues to experience deep financial distress, with several major developers advancing towards key restructuring stages. Many creditors have begun to accept limited recovery prospects amid widespread defaults and liquidity challenges that have destabilised the industry.
In a related development, Country Garden revealed earlier this week that its controlling shareholder had agreed to convert USD 1.14 billion in loans into equity as part of its offshore debt restructuring. The company had defaulted on billions of dollars' worth of offshore bonds in late 2023. Meanwhile, Bloomberg News reported last month that China Vanke was in discussions with major domestic lenders to reduce borrowing costs on billions of yuan in private debt, as developers continue to seek relief amid persistent market headwinds.
The strong creditor support for Sunac China's restructuring marks a turning point in the company's efforts to rebuild its financial position and restore confidence among stakeholders. With court approval anticipated soon, the developer joins a growing list of major Chinese firms working to renegotiate offshore debt terms under the strain of the property crisis. As other leading developers, including Country Garden and China Vanke, pursue similar restructuring strategies, the sector's overall recovery remains contingent on improved liquidity, policy support, and market stabilisation measures.
Source - Reuters
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